What Price Pensions?

continued

The number of employees in the defined-benefit plan, the Washtenaw County Employees Retirement System (WCERS), fell steadily in the years that followed. According to Monica Boote, the county's human resources operational director, by 2007 just 155 employees were still covered. But in 2008, the county reopened its defined benefits plan, folding newer employees' individual retirement accounts into WCERS. Five years later, more than 1,000 staff members are "vested"--with enough seniority to claim at least a partial pension--in the system. With an average age of forty-four, they'll be collecting guaranteed payments for decades to come.

"A lot of people think it wasn't a good idea now, but our administrator did that with the board's support," says county administrator Verna McDaniel, referring to her predecessor, longtime administrator Bob Guenzel. "We all were there."

"The unions proposed it, AFSCME primarily," Guenzel remembers. "We were successful in getting the unions to give up a [scheduled] 2 percent [pay] increase. That was a big structural savings, and in return they wanted to go back to defined benefits.

"It was a very difficult decision, but given what we faced and the actuarial projections we had, we felt we were protected," the retired administrator says. "And by those negotiations we saved about 100 positions and services."